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5 min read

Demand gen vs lead gen: What’s the difference?

Demand gen

Demand generation and lead generation are two inbound marketing strategies that are often used interchangeably. But in reality, these terms refer to totally different strategies that can be used in tandem to create a successful marketing campaign.

Demand gen creates awareness and interest in a product or service, whereas lead gen turns those prospects into warm leads that can go on to become customers. They take place at different stages of the sales funnel, with demand gen at the top, and lead gen coming later.

In this article, we’ll take a closer look at both of these terms and what they mean for marketing teams, as well as the crucial differences between them and how they can both be used to produce a successful campaign.

What is demand generation?

Put simply, demand generation is a marketing technique that allows you to drive demand for your product or service. Demand gen is all about gaining brand awareness, getting your audience excited, and gaining their trust.

This strategy is great for top-of-the-funnel marketing activities and involves attracting and educating potential customers to grow your audience. It’s about providing your potential customers with the information they need at every touchpoint in the customer journey, positioning your brand as a trusted advisor that can foster brand loyalty.

So the goal of demand generation is to increase brand awareness and grow your audience. To do this, businesses can create unique content for their audience and establish themselves as thought leaders in their industry.

Content types for demand gen

Content is key to a successful inbound marketing campaign and demand gen is no different. To attract the attention of your target audience you should make use of paid ads and social media as these tend to have a further reach. Then to educate your audience you should consider using blog posts or podcasts to gain a reputation as a thought leader.

With this strategy you should be able to attract new customers and gain their trust - once you have achieved this you can move into your lead generation tactics to secure a sale.

Here are some content types to consider when you are planning your demand gen strategy:

  • Blogs
  • Thought leadership content
  • Podcasts
  • Videos
  • Social media posts
  • Paid ads

Measuring demand gen

Ensuring your demand generation campaign is performing well can be tricky - good thing we’ve outlined the key metrics to measure in demand generation!

  • Cost per lead
  • Organic traffic
  • Customer acquisition cost
  • Domain authority
  • Customer lifetime value
  • Sales cycle length
  • Market share percentage
  • ROI

What is lead generation?

Lead generation is the process of converting marketing qualified leads (MQLs) into customers by nurturing that lead with the likes of lead generation strategies, such as producing content or using engaging CTAs. Lead gen helps to increase quality leads at the bottom of the sales funnel.

The key goal of lead generation is gaining prospects' contact information to send targeted content to their emails and convert them into paying customers, such as when they fill out a form to receive a special offer or sign up to a company’s newsletter.

Content types for lead gen

The types of content needed for a lead gen campaign are slightly different than for demand - but no less important! Having signup forms for lead generation content is crucial as this allows you to capture the potential customers’ contact information. This means gated content such as webinars, whitepapers, reports, and events are all great content types for lead gen strategies.

But in order to bring these aware customers back to your site to sign up, you may first want to consider paid targeted ads and/or retargeting ads. These will help to pull leads through from the demand campaign to the lead campaign.

Some content types that are suited to lead generation strategy are:

  • Webinars
  • Paid targeted ads
  • Retargeting ads
  • Gated content (whitepapers, reports, etc.)
  • Events

Measuring lead gen

Keeping your lead gen campaign on track means taking a look at all those key metrics - here are some to help get you started.

  • ROI
  • Customer acquisition cost
  • Click-through rate
  • Conversion rate
  • Time to purchase
  • Number of email subscribers
  • Number of qualified leads

Differences between demand gen and lead gen

If the differences between demand and lead generation still aren’t clear then here is a breakdown of some of the key areas where these terms differ.

Goals

These campaign styles vary in goal. Demand generation is looking to increase brand awareness and gain the customer’s trust - ultimately leading to a demand for your product or service. Whereas in lead generation the goal is to gain the contact information of MQLs so that they can eventually buy your product or service.

Funnel placement

The placement of these campaign strategies within the buyer funnel is rather different. Demand gen campaigns are situated near the top of the funnel, when the target audience may not know about the problem you are trying to solve. Lead gen campaigns are further down the buyer funnel when potential customers are aware of the brand and want to know how the product/service can solve their problem.

Content

Due to the differences in goals and funnel placement, it’s no surprise that the content involved in these strategies is different. In demand generation, the content is about attracting a wide audience and educating them. This means that blogs, podcasts, social media, and paid ads are great content types for creating demand.

On the other hand, lead gen focuses on bringing customers back and gaining their contact information. This means retargeting ads, events, whitepapers, and reports (which are gated) are more relevant to lead gen.

Using demand and lead gen in your marketing strategy

To get the best results from demand and lead generation strategies you should consider using them in tandem. Using both of these strategies will help you to bring leads seamlessly through the customer journey by targeting them with relevant content at each stage in their buying journey.

Starting with demand gen, you can use social media and paid ad campaigns to gain brand awareness. Then you can present yourself as a thought leader by making use of blogs and podcasts, this will help to gain your audience’s trust.

Once customers trust your brand you can move in with your lead gen strategy, first by using targeted ads and retargeting campaigns to further their interest. Then using gated content such as events and whitepapers to gain contact information, before finishing off the process with targeted email marketing.

This combined strategy allows for a well-rounded approach to inbound marketing and helps to drive customers through the marketing funnel towards being paying customers.

Final thoughts

To sum it all up, demand generation and lead generation are both powerful marketing strategies - but are even more powerful when used together.

Demand gen focuses on gaining the audience's attention and increasing brand awareness all at the top of the buyer funnel. Lead gen, focuses on gaining the contact information of MQLs and helping them to finalize their purchase decision. By combining both strategies at different stages of the sales funnel, you’ll gain more prospects and see an increase in generated revenue.

Curious about how other organizations utilize demand gen and lead gen? Join the Revenue Marketing Alliance community and ask your questions to our members!


Written by:

Rebecca Stewart

Rebecca Stewart

Rebecca wants to be a florist when she grows up - too bad she’s allergic! For now she studies marketing and writes mildly amusing content.

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Demand gen vs lead gen: What’s the difference?